Laid off by state cuts, workers likely to join the underemployed

Dianne Lee is one of the lucky ones — an experienced and talented stained-glass artist, she has a ready-made job to replace at least some of the income she earns at the N.C. Center for the Advancement of Teaching in Cullowhee.

This month, NCCAT Director Elaine Franklin was forced to notify 50 percent of the teaching center’s workforce they were losing their jobs because of state budget cuts. That translates to about 30 fulltime jobs in Jackson County, plus another five to 10 at the center’s campus in Ocracoke. The annual salaries of the laid-off workers ranged from the lower end of $20,000 up to $80,000, Franklin said.

Lee was one of the victims. She has worked at NCCAT for 18 of the institution’s 25 years, helping with programs and running NCCAT’s Alumni Weekends. NCCAT provides training and development for teachers around the state, keeping them inspired and, in turn, more likely to stay in the profession.

“I’m going to make lemon out of lemonade,” said Lee, who in a lengthy phone interview sounded more worried about her colleagues’ employment prospects than her own. “I am losing sleep over them — some are scared to death.”

And, in fact, it’s not going to be easy in this harsh economic climate for the NCCAT workers to replace those state salaries and benefits. They are more likely, experts say, to join the ranks of the growing underemployed in North Carolina.

How WNC’s recession unfolded

“This thing has come in waves,” said Victor Moore of OnTrack Financial Education and Counseling, a nonprofit based in Asheville that offers consumer credit advice for North Carolina’s 18 westernmost counties.

Moore said the first wave of help seekers to come to OnTrack when the recession hit were people who basically had engaged in bad loans and were defaulting at the first hint of economic trouble. Then, the construction and building industry faltered, and threw many in the region out of work. The land speculators were next — plans to “flip” properties and make quick profits were no longer viable options, and some people with second homes were also soon in trouble.

Now, to an extent, come the underemployed, Moore said. These might be workers who find a lower paying job, but can’t bank on 40 hours a week and aren’t working up to their earning potential.

Lee, for instance, won’t necessarily start showing up in the official monthly unemployment rate, because she will be operating her business, the Stained Glass Bungalow in Waynesville.

The unemployment rate decreased in just under half of North Carolina’s 100 counties in May, which state officials attributed to a rise in seasonal employment. The state rate was 9.7 percent for that month. Jackson stood at 8.8 percent, Haywood 9 percent, Macon 9.9 percent and Swain 11.1 percent unemployment.

But those numbers fail to take into account the underemployed, a demographic Lee and her laid-off colleagues who are lucky enough to find work are likely to fit — people in WNC who lose one level of job and pay, and are forced to accept a lower level job for less pay and, often, fewer hours.

“Because they are not just going to go out and find comparable employment right now,” said Amy Grimes, director of The Community Table, a soup kitchen in Sylva. “Or, the jobs they can get pay them less than collecting unemployment, which was based on the job lost.”

A recent survey at The Community Table showed an increase in the number of people seeking help who are college educated, Grimes said.

Mark Clasby, executive director of the Haywood County Economic Development Commission, said the unemployment numbers don’t truly reveal the extent of the problem.

“They don’t include the people who have given up on the system,” Clasby said, adding that he worries about what’s coming down the pike for North Carolina.

The state budget problems might continue to compound, he said, leading to even more job losses in the local and state governmental sectors.

“It could be an even bigger problem next year,” Clasby said.

It’s all in the numbers

Franklin, head of NCCAT, gets emotional when she talks about having to lay off about half of the 82-member staff, which followed a budget cut by the state General Assembly from $6.1 million to $3.1 million.

This wasn’t about performance issues, this was about money, said Franklin.

“We’re losing good people,” Franklin said, apologizing for tearing up during the interview. “We also told them we hoped to be getting funding through grants and contracts — I hope to hire them back if we can.”

Lee said she has no bitter feelings toward NCCAT or Franklin, she just regrets losing a job she loved so much. Franklin, Lee said, did what she had to do following such drastic budget cuts.

“NCCAT is the only organization in the nation who does this sort of work for (state) teachers,” Lee said. “I cannot tell you how much it means to me.”

Lee has just two years left before she could draw full retirement benefits from the state, and she said there is a possibility that she’ll move to get the necessary time in with the University of North Carolina at Charlotte.

There are jobs openings to be found locally, but they pay $8.50 to $9 or so an hour, said Ann Howell, branch manager in Sylva for the N.C. Employment Security Commission. Howell went last week to NCCAT to talk with the people being laid-off.

“I try to be positive,” the 26-year agency veteran said. “You’ve got to be positive — new doors open everyday. Right now, in these times, perhaps it’s not the brightest doors, but there are some jobs out there.”

The N.C. JobConnector is a new state service that’s proving helpful, she said. It uses an automated system that matches job orders and job seekers based on job-order requirements and job-seekers’ experiences. People are alerted by email to possible employment opportunities — kind of like match.com for employers and prospective employees.

Dale West, a regional manager for the Employment Security Commission based in Macon County, said she is stunned by the impact the construction drop-off had to Western North Carolina’s overall economy, and that the waves are continuing to roll in.

“I knew the construction trade was a major force in our economy, but I’m not sure I understood how big a force it was,” she said.

The jobs lost did not come in one fell swoop, West said, but in a continuous trickle from such tangential businesses as building supply companies.

“A few from lots of different places,” she said.

West also pointed out that many of the people who work in construction or related trades can’t draw unemployment because they worked as sub-contractors, and their bosses did not have to file unemployment taxes as a result.